Forex intraday trading strategies are speculative strategies used to sell and buy financial instruments in the stock market within the same trading day. Daily trading takes place within a short period of time and, therefore, market players must find the best intraday currency strategy in order to succeed in their transactions. Next, we will investigate the most widespread intraday currency trading strategies.
This intraday currency strategy assumes that market players analyze stock price movements instead of the financial strength of companies. Trend tracking is a simple trading strategy on the currency day under which market players believe that current trends that persist in the stock market will remain in effect. Therefore, if the share price increases, it is likely to continue to grow and, therefore, the investor is interested in buying such shares. On the contrary, if there is a downward movement in share prices, the investor will be interested in short selling such shares.
The opposite investment consists of the actions of the investor to buy or sell shares in contrast to existing market trends. Therefore, if the price of the shares falls, the investor buys those shares and, conversely, if their price rises, the investors sell them, in both cases waiting for the trend to reverse soon. This may be the best intraday forex strategy when the investor is confident in any of the two main prerequisites:
-The shares enjoy excessive demand in the market and have an excessive price, that is, there is an excessive optimism (high price> sale);
– The market pessimism is extremely high and drives the value of the shares below their market price (low price> purchase) (see image below).
According to the intraday Forex strategy, the investor buys shares as soon as some positive news is obtained about the expected growth in the price of such shares, or on the contrary, sells shares when bad news arises.
The factors that can make the investor use the news that plays the intraday currency strategy can vary from market factors (such as investor expectations, expected price fluctuations, negative or positive economic dynamics, etc.) and even Several political and other factors not directly related to the currency market. Therefore, to benefit from the reproduction of news, the investor must be aware of the multitude of variables that affect the dynamics of the market and must be able to closely monitor any changes to obtain a rapid response.
Intraday scalping forex strategy
This intraday forex strategy for stock trading is based on the detection of small gaps in the buy-sell differential and the start of a large number of short-term intraday transactions with small returns. A position within the scalping strategy generally opens and closes quickly, in order to benefit from the price gaps currently available.
Due to the fact that the intraday scalping forex strategy is implemented within limited periods of time (usually 3 to 5 minutes, less frequently 13 to 15 minutes), this strategy is quite risky and imposes several key requirements for The scalper is effective. Therefore, first, the broker needs to process all offers quickly, since even seconds of delay can make the transaction ineffective. Next, scalping should be allowed for short-term transactions in the respective exchange. Finally, large buy-sell differentials should be avoided, since they can minimize the already limited profit margin, which makes scalping economically inefficient.
Scalping may be the best intraday currency strategy in conditions of increasing volatility and market fluctuations, allowing market players to benefit from the short-term imbalances that occur during those periods.